In many respects, starting a business today is easier than it ever has been. Entrepreneurs usually need little more than a good idea and an Internet connection to get a venture up and running. As start-ups expand, however—and the best ones always do—executives need to pay attention to the sort of culture they want to foster. The idea of “company culture” is somewhat amorphous, and usually conjures images of corporate retreats and mission statements framed on boardroom walls.

In an entrepreneurial venture, culture usually follows the same basic model as it might in a big company, but there are also some important differences. Young CEOs and start-up executives must usually spend time upfront developing and honing their culture in a way that is specific to their goals and visions, but also must be flexible when it comes to changing that culture to suit the needs of the company as it grows.

Company culture is one of the few competitive advantages that entrepreneurs can actually control on a day-to-day basis. Sure, they can set goals about profits and have visions for future products, but these are generally long-term, and are dependent on a host of external factors. Creating an impenetrable internal culture can transform otherwise qualified employees into powerhouses of productivity and positive energy. Most start-ups need this sort of momentum.

Getting there is rarely easy, however. “Creating a culture is hard,” Aubrey Sabra, former marketing manager for internet start-up Digg, told TechCrunch. “It’s not something you can artificially build by putting posters up on the wall or having weekly in-office happy hours.” Sabra conceded that a lot of Digg’s positive culture was owing to its somewhat laissez-faire atmosphere, which embraced creativity and allowed a lot of time for employee bonding. What really made the company work, though, was the connections employees felt with each other and their shared vision. “The people were why we woke up every morning, why we tackled impossible problems with smiles on our faces,” she said.

The start-up approach to culture is and must be different from that of a major corporation for mainly this reason: the people, the core employees, play a very different role. In a bigger office, workers are usually segregated by division. They tend to focus only on tasks within their realm of expertise, and may not always understand how their individual contributions relate to or influence the overall success of the company as a whole. Motivating and encouraging employees in this sort of setting is very different from recruiting and energizing people to get down on the ground with a start-up.

Start-ups have a different dynamic, with fewer employees and far less division of responsibilities. For the CEO and founders, however, this means that choosing the right mix of people is all but essential. There is usually no HR department to help smooth over abrasive personalities, and no easy way to let people go who do not end up working well. The time it takes to invest in and train an employee, particularly at the early stages of the game, means that executives need to have a firm idea of their cultural norms and expectations before they even begin reviewing resumes.

Many of today’s youngest entrepreneurs have a leg-up when it comes to hiring demographics, as most of their applicants are recent college graduates in the Generation Y category. People in this demographic tend to have a more vibrant, open view of work—they want balance and flexibility, but also have an almost unquenchable drive for innovation and hard work.

“The Gen Y population may seem cavalier to some with their social media obsession and their desire to have more control over their time, activities, and work culture,” Caroline Dowd-Higgins, author of This Is Not the Career I Ordered, told the Huffington Post. These characteristics typically make Gen-Yers very well suited to start-up cultures. “Only 7% of Gen-Y works for a Fortune 500 company because startups are dominating the workforce for this demographic in today’s economy,” Dowd-Higgins said.

Company culture at start-ups is largely thriving as a result. Companies staffed almost exclusively by 20-somethings include car rental giant Zipcar and technology review website Others, such as YouTube, Google, and Facebook, started out that way. While youth is not something on which corporate culture can be anchored, it can help it thrive, particularly in the early phases of company’s development. Younger executives are often more willing to step outside of the lines, and bring a certain quirkiness to the internal culture that often resonates well. Many young people are seeking out work in start-ups as a way to feel included and understood—and avoiding more traditional corporate jobs for the same reason.

“Gen-Y entrepreneurs are running their companies in new ways, and they’re likely to change the way businesses run for a long time to come,” Jennifer Kushell, president of Young & Successful Media Corp., a consulting firm, told Workforce magazine in 2012. “Coming of age during a period of great technological change, they live and breathe tech, and take for granted the informal communication the Internet fosters.” This sort of shared approach can be a tremendous asset when it comes to falling in line with corporate vision, as well as coming up with new innovations.

While there is no set recipe for corporate culture, it is an essential part of any start-up plan. Ensuring that the right people come on board—and that, when they do, they have a good sense of what the company is all about and how they can contribute—is often one of the easiest ways to set a new company on the path to success.

Article by Julianna Davies, a contributing author to the online MBA resource


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